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Seattle Genetics is reporting today on a batch of clinical trial results that represent a watershed moment for the company, its technology for creating “empowered antibodies” against cancer, and which could provide a new source of hope for patients with Hodgkin’s disease.

The company (NASDAQ: SGEN) and its partner, Cambridge, MA-based Millennium: The Takeda Oncology Company, are presenting detailed results today from a study of 102 patients who got brentuximab vedotin (SGN-35) as a treatment for relapsed forms of Hodgkin’s disease. Researchers found that one-third of the patients (34 percent) had their tumors completely eliminated after getting the new drug, while another 41 percent had their tumors shrink by half or more, and a total of 94 percent had at least some observable tumor shrinkage. All kinds of nitty gritty details on how long the remissions lasted, and the drug’s side effect profile, are being disclosed today at the American Society of Hematology (ASH) meeting in Orlando, FL.

Seattle Genetics plans to package this data in an application to the FDA by the end of March, in which it will seek clearance to start selling the product in the U.S., where it holds 100 percent of the commercial rights. Millennium, which has a lot of experience in blood cancers with its $1 billion hit bortezomib (Velcade), holds the rights to this drug in Europe and plans to seek regulatory clearance there in 2011. If the FDA allows the drug on the market next year, it will mean Seattle Genetics will be transformed from an R&D-only operation into a more diversified commercial organization. The drug is also being closely watched in the biotech industry, because it could be the first time anyone has been successful with an “empowered antibody”—a molecule that’s designed to zero in specifically on cancerous cells, carrying a potent tumor-killing toxin.

While about two-thirds of the 8,500 patients diagnosed in the U.S. with Hodgkin’s disease are successfully treated with chemotherapy, one-third eventually get relapsed, treatment-resistant forms that provide a grim prognosis—a life expectancy of just two to three years. The new Seattle Genetics drug could be the first treatment for this patient population in more than two decades. Seattle Genetics already released some of the results to investors in September, and its stock has soared 56 percent this year on the news, but this is the first time the data will get scrutinized in detail at a medical meeting with more than 20,000 people in attendance.

Clay Siegall

“I’ve been a part of many clinical trials before, and this is one of the best results I’ve ever seen,” says Robert Chen, a hematologist at the City of Hope in Duarte, CA, and an investigator on the study who will present to his peers at the ASH conference. “I’m very excited for patients with Hodgkin’s disease.”

Clay Siegall, the CEO who co-founded Seattle Genetics a dozen years ago, says he sees the new drug as a cornerstone in a plan for the company to become a much bigger force than it is today in cancer drug R&D. “We want to be the next Celgene, the next Genzyme, the next really important biotech company,” Siegall says. “We have the nucleus, and we have the technology to do it.”

Before going deep into the clinical trial results, a little science background is required. Seattle Genetics’ genetically engineered antibody is designed to hit a protein target found on Hodgkin’s lymphoma cells known as CD30. This is a target that’s structurally different from the one hit by one of the best-selling antibody drugs of all time, Roche and Biogen Idec’s rituximab (Rituxan), which is made to hit a protein called CD20. Rituximab, first approved by the FDA in 1997, is a “naked” antibody that zeroes in specifically on cells bearing the CD20 target. The new Seattle Genetics antibody has a similar targeting capability, but adds a tiny dose of a highly potent chemo agent that is supposed to give the antibody even greater knockout punch against the cancer cells. Scientists have tried this approach for decades, with no real success, usually because the toxin would break off from the antibody in the bloodstream, or the toxin just never got properly deposited in the tumor cells.

Now, here’s what the trial was designed to say—and what it doesn’t say.

The trial started in February 2009, after the company and the FDA agreed it was properly designed—through what is known as a Special Protocol Assessment. All patients got the treatment, so none were randomly assigned to a control group—a practice that is often considered the gold standard of medical evidence. By designing the trial this way, Seattle Genetics knew it would have a better chance of recruiting patients quickly, because all patients knew they would get a promising new agent, and not risk a 50-50 chance of getting a placebo or another round of chemo.

Patients were given intravenous infusions of the Seattle Genetics treatment every three weeks, getting as many as 16 total doses. Patients who enrolled had relapsed or refractory (treatment-resistant) Hodgkin’s, they had already undergone autologous stem cell transplants, and all had seen their disease worsen after getting a median of 3.5 prior rounds of therapy. Essentially, these were the sickest of the sick patients with Hodgkin’s, with no good options left. They were a median age of just 31 years old, and had a life expectancy of two to three more years at the time they enrolled in the study.

The main goal of the study was to look for the number of patients who experienced tumor shrinkage of 50 percent or greater, as measured by an independent centralized radiology review. This study goal, known as overall response rate, is considered a fast and easily obtainable measurement that is often a leading indicator of whether a cancer drug is doing what’s most important—helping people live longer, and hopefully providing them with high-quality lives. The FDA often wants to see an independent central radiology review of medical images, which can help correct for the bias of physicians who treat the patient directly and want to see them do well on a new drug.

This study, as Siegall has said in the past, would have been considered good enough to seek FDA approval if Seattle Genetics had helped 30 percent of these patients get at least a partial (50 percent) response. Instead, the company is reporting today that 75 percent of patients did that well, and 34 percent went into a complete remission, in which radiologists couldn’t see any evidence of tumors left on their medical images.

Tumor shrinkage can sometimes be an unreliable indicator of success in cancer drug development, because cancer can sometimes bounce back very quickly and resist therapy, killing people just as if no treatment was given at all. Researchers in this study are continuing to follow patients to obtain the gold-standard measurement of overall survival time, but not enough time has passed for them to report with any statistical confidence on whether this drug is helping people live longer, and if so, by how long. That will take more follow up time, Siegall says.

Still, there are some more encouraging early indicators that that this drug will someday prove it can help extend lives. The independent central review found that the median duration of response was a little more than six months (29 weeks) when looking at the whole set of 102 patients. When researchers looked at the one-third who went into complete remission, they still haven’t seen enough relapses after a full year of follow-up to even calculate a median duration of response. That means it will take more follow-up time for researchers to find out just how long the remissions really last.

Side effects were mostly mild compared to conventional chemotherapy. Almost half (47 percent) of patients experienced some degree of peripheral neuropathy, which is nerve damage/tingling in the fingers and toes. Another 46 percent reported fatigue, 42 percent reported nausea, and 37 percent had upper respiratory tract infections during the study. Among the moderate to severe side effects, researchers reported that one-fifth (20 percent) had a depletion of their infection-fighting white blood cells, known as neutropenia. About 8 percent of the cases of peripheral neuropathy were considered moderate to severe. Another 8 percent of patients had significant depletion of clot-forming platelet cells in the blood (thrombocytopenia), and about 6 percent reported a significant knockdown of their oxygen-carrying red blood cells (anemia).

Because of the drug’s high degree of potency, and mild side effect profile, this study is really just the first step for brentuximab vedotin, Chen says. He predicted that “you’ll see the majority of clinicians using this drug,” almost right away for the sickest Hodgkin’s patients, if it is FDA approved. “These patients are really at the end of the line, and this drug really offers them a lot of benefit,” Chen says. “It’s buys them time, and gives them comfort.”

As for the side effects, he says, “they’re all manageable.”

Seattle Genetics is also testing the hypothesis of whether this drug—again because of the high potency and low side effects—has potential to become part of the standard of care with chemotherapy when patients are newly diagnosed with Hodgkin’s. There’s another study underway in which doctors are looking to see if giving brentuximab vedotin after a stem cell transplant helps prevent relapse or prolong the time before relapse.

And while Hodgkin’s is rare, there’s a biological rationale to test this product in many more diseases. Seattle Genetics chose Hodgkin’s in the first place because it is a malignancy in which the CD30 protein is present in abundance on the surface of cells, making it a good target. But CD30 is found on other cancers, too. Back in October, Seattle Genetics reported even better results (an 86 percent overall response rate among patients) in anaplastic large cell lymphoma, for instance. More detailed results on the Seattle Genetics drug, and its ability to generate at least partial remissions in 50 out of 58 patients studied, are expected to be presented at the ASH meeting at 7:30 am Eastern on Tuesday.

Siegall said his scientific team is hard at work studying the pathology of many rare cancers, such as cutaneous T-cell lymphoma, peripheral T-cell lymphoma, certain B-cell lymphomas, and sarcomas, to see whether his new drug has potential to make an impact against a wider array of these ailments.

Seattle Genetics will not be the only ones on the lookout for any and all cases of cancer that appears related to CD30. Hospitals will now start examining individual tumor samples in their pathology labs for any evidence of abundant CD30 markers, which could justify use of the new drug once it becomes available, Chen says. “There’s now a real reason to look for it,” Chen says. “I think you’re going to see more clinicians asking pathologists to look for it.”

The company, of course, is racing to get ready for this surge in demand, which means it needs to build up capability in sales, marketing and manufacturing that it never needed before. Key strategic questions—like how to set the price, and how to persuade insurers to pay for it—will have to be answered in the coming year.

By the end of 2011, Seattle Genetics expects to have built a commercial team of about 110 people, as part of an overall company staff that could grow to 475-500 employees over the next 12 months, Siegall says. The mission will be to lay out a game plan for brentuximab, and beyond, Siegall says.

“I believe this product is phenomenal and it has a lot of legs to it,” Siegall says. “Rituxan has had a very big impact on patients with B-cell lymphomas. We think we can have that kind of impact on Hodgkin’s and certain T-cell lymphomas.”